FxWirePro: AUD/USD eases as markets react to China data shock

• AUD/USD dipped on Monday after weaker-than-expected Chinese economic data sharply dampened sentiment toward the China-sensitive Australian dollar.

• China’s April industrial output rose 4.1% y/y, well below the 5.9% market forecast, while retail sales increased just 0.2% against expectations of 2.0%, highlighting slowing momentum in the world’s second-largest economy.

•Geopolitical tensions   intensified after a drone attack on a UAE nuclear power plant pushed energy prices higher, with Brent crude rising 1.9% and WTI gaining 2.2%, adding to global inflation concerns and supporting the U.S. dollar..

•Attention now turns to comments from RBA Assistant Governor Sarah Hunter on Tuesday ahead of the release of the RBA May monetary policy meeting minutes.

•Investors will also closely watch Australia’s April employment report on Thursday, where Reuters polls forecast a 20K rise in jobs and an unemployment rate of 4.3%.

•  Immediate resistance is located at 0.7175 (38.2%fib), any close above will push the pair towards 0.7193(23.6%fib).

•  Support is seen at 0.7090(38.2%fib) and break below could take the pair towards 0.7065(Lower BB).

 Recommendation: Good to sell  around 0.7160 with stop loss of 0.7220 and target price of 0.7090